Business Simplification 2015: The Unmet Strategic Imperative

Business simplification is a strategic imperative for today’s companies if they wish to unlock innovation and position themselves for future success in an increasingly complex world. Yet, many corporations are not aligning their actions more effectively with their stated goals of simplifying business processes, decision-making and IT functions — and as such risk falling behind nimbler competitors, according to the “Simplifying the Future of Work Study,” a survey conducted by Knowledge@Wharton and SAP.

Corporate inertia, lack of clear prioritization from top management and under-utilized technology solutions are some reasons why there is a jarring disconnect between what companies say and what they actually do about business simplification, the survey showed. Denise Broady, chief operating officer of industry cloud at SAP, said companies have struggled with simplifying their businesses for years as they battle everything from a corporate culture resistant to change to managers finding little time for implementation. “It is always a challenge and the larger the company, the more complex it is.”

“Business simplification is necessary, and perhaps more so now than in the past.” Morris Cohen, Wharton

Top management is well aware of the value of business simplification. In the survey, 51% of about 700* mainly business leaders said simplification carries significant strategic importance for their enterprise. They also expect the importance of business simplification to increase in three years —67% of respondents said the issue will become even more strategically significant. But when asked whether the actions of top management support the companies’ simplification efforts today, only 27% said that day-to-day actions are strongly aligned. Business leaders are talking the talk on simplification, but they are not walking the walk.

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